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Acrisure Closes $725 Million Equity Funding, Valuing Business At $23 Billion
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TRANSCRIPT BELOW:
John Pelle:
We are Acrisure, the thousands of colleagues behind the global fintech leader we are today. We're known for winning, trust and purpose. And through the Limitless Possibilities podcast, you'll hear from the people behind our unprecedented success and limitless culture. These are the voices of Acrisure. Welcome to the Limitless Possibilities podcast. I'm your host, John Pelle and joining me as Lowell Singer, Acrisure's Chief Financial Officer. Lowell, welcome to the podcast.
Lowell Singer:
Thanks John. Thanks for having me.
John Pelle:
Yeah. And you can't see Lowell. He has a really cool fancy microphone, so I'm already feeling like he came very prepared. So Lowell, just for folks out there, joined Acrisure as CFO last year. A lot of fanfare coming from 14 years with Disney, a company, a few people on the show may have heard of. And I hear you're a student of standup comedy. So all that said, I think we have enough jam packed in for a cool episode.
Lowell Singer:
And you are right John. I am a student of standup comedy. I've done a little myself and always appreciated standup comedy. But until I got up and had to do a five minute set at the Improv, I don't think I realized just how challenging that is as a career. So being a CFO, I think while challenging, has many different attributes and you don't stand up in front of a room of 200 strangers and hope that your joke lands, so very happy to be here.
John Pelle:
What's harder, sharing quarterly earnings or telling a joke into a packed room?
Lowell Singer:
You know it's interesting. One thing I learned as I studied stand up is that when you and I hear a joke, oftentimes it is not the first time that the comedian has tried the joke. And they've workshopped the joke. They've refined the joke. Sometimes it's a joke that they've been working on for years. So you do get an opportunity to work those things out. When you're doing quarterly earning calls, you get one shot at it and you want to make sure you get it right, or a lot of people's net worth could be impacted. So I would say the quarterly earnings call is actually in a strange way, a little more challenging than standup comedy.
John Pelle:
Yeah. So, Lowell, I want to kind of flash back to around September, October last year of 2021, thinking about you joining Acrisure. Obviously going a little bit further back in your career at Kraft Foods, another very well known company, very strong brand. Obviously Disney doesn't really need much of an intro. Now you're at Acrisure. Would love to know a little bit about first, what in your view makes a brand, a special brand, coming from the companies that I've named? Obviously Duke and Stanford in their own right, those are brands. So you really have been at places that are well known. They operate a certain way. I'd love to just start there a little bit more, just your thoughts on what makes a brand stand out.
Lowell Singer:
Well, I've thought a lot about this over the years, and I think at the core, brands elicit emotions. And you hope that you have in your hands a brand that conjures positive emotions. Do people think of it in a manner that reflects the quality of the brand? Is it a brand that you can trust? Is it accessible? Is it aspirational?
Lowell Singer:
I had the great benefit to work at Disney for 15 years. And you want a conversation starter, walk into a party and tell people that you work at Disney. Most of the time, it elicited really favorable comments; people remembering their first trip to Disney World, The first Disney movie, they saw the first Disney, Pixar, Star Wars, Marvel movie they shared with their children. Sometimes it would elicit a different response, which is, this is the experience I had, and here's what I think you can do to improve it. But everyone had an opinion because everyone had a connection with the brand. Those are things that are very difficult to create. And I think being able to take that piece of clay and really begin to shape it for new audiences is super exciting to me.
John Pelle:
And you mentioned audiences and I'd be remiss if I didn't kind of join you in giving a shout out. We have so many folks probably listening from our finance and accounting, treasury related roles we call it, out of our Acrisure home office in Grand Rapids and in other remote locations. So I'd love to give you the chance Lowell, to just give a message to those folks who every day are just doing unimaginable lifts to keep the company going. And obviously doesn't need further explanation there.
Lowell Singer:
Yeah. And I appreciate that John. Total shout out to the finance team who have worked incredibly hard over these past two years while we've been keeping, not just the trains running on time, but continuing to improve on how we do our jobs. And we're doing that in real time while the company is adding a significant number of acquisitions on an annual basis. And because of that, we're doing this while riding an automobile at 75 miles an hour, which I believe is the speed limit in Grand Rapids home office. I want to be clear, no one's violating the law. But I was very lucky to inherit a team that was incredibly accomplished, functioning at a high level. My predecessor as CFO did a great job building out that organization. And in many ways it made my transition into this role very smooth. So I appreciate everything that happened before I joined. And I certainly appreciate all the work that team has done since I've joined. I think we have a wonderful team and I think we're going to have opportunities to continue to support the growth of the company in the years ahead.
John Pelle:
And sometimes finance, I think, unfortunately, they could become unsung heroes. A lot of the work that happens, it's like the clock ticking. It just, you take it for granted, and yet Acrisure is out raising billions of dollars in capital and closing hundreds of acquisitions a year. Are there any special projects or efforts you want to give a quick shout out for, things happening in 2022, you want to give a preview to?
Lowell Singer:
Well, I hope at Acrisure, they will be sung heroes, not unsung heroes. I'm not entirely sure what a sung hero is, but I'd like to believe that. No, there are a lot of things that we're doing. We are continuing, as you said, to raise a lot of capital to finance our ongoing M&A efforts. We are working diligently to deploy technology to help us in many ways throughout the finance organization. And I think we're continuing to professionalize a lot of the things that we do. I mean, we are closing the books on a monthly basis. We're doing monthly reporting, quarterly reporting, annual reporting. We're three months away from beginning our budgeting process for next year. And this is a very small, dedicated team who work very hard, really are passionate about the company, and passionate about the work they're doing. And I know that I speak on behalf of not just myself, but Greg and the entire executive team. We could not do what we're doing with this company without them.
Lowell Singer:
The other thing we're really working hard on this year is we're trying to more fully integrate the finance team into the business segments. We want folks on our team to be working as closely with the insurance team, the real estate team, and the cyber team as possible, because I think table stakes is financial reporting. But where we benefit as a company is when the finance organization and the business teams are working in concert. So it's a lesson I observed the benefits of for 15 years at Disney. And I hope to do a lot more of it in the months and years ahead.
John Pelle:
So Lowell, we've recently announced the B2 round, introducing some new investors into the fold and that press release is available on Acrisure.com. So Lowell, walk us through that process. What was that like, bringing in a new investor into the mix and then working with current investors and their additional capital?
Lowell Singer:
Again, I think it was a really illuminating process for me because it's the first significant capital raise I've been a part of at the company. But again, it demonstrated the appeal of the story. We brought a significant new investor into the company, an investor that I think will be a great partner for us on a go forward basis. And we also extended relationships with two existing stakeholders, which I view as an ongoing validation of our strategy. One of them was a lender who is now taking an equity position. The other was an equity investor who's extending their equity investment.
Lowell Singer:
And as someone who's new to the company and very excited about what we're doing, it's great to have third parties validate that strategy because these are folks who clearly made the decision that they want to extend their relationship with Acrisure, so I think it's a great outcome for stakeholders.
John Pelle:
Well, in many of our presentations and things you hear from Acrisure, we are a company of numbers. There's a lot of them and they're all very good. And I say that biased, but also unbiased. When you have conversations with the investment community, with colleagues, with partners, what numbers in your view about Acrisure paint the best picture or more so, the most accurate picture of what we're achieving together?
Lowell Singer:
Well, I'd say broadly, John, there are a number of numbers. Can you be a number of numbers? There are a number of numbers, or maybe there are numbers squared, that I find particularly appealing about our story. The pace of M and A, the number of deals we're able to close on an annual basis, the kind of revenue growth we've delivered, and I expect will continue to deliver, and the margins that we can derive from our business are all really appealing.
Lowell Singer:
In fact, if you step back and look broadly, there are about 70,000 publicly listed companies in the world. And if you then drill down into companies of 15 billion or north in market cap, that are based in the US, that have EBITDA margins north of 30%, that have unlevered free cash flow margins of 70%, and that drive annual revenue growth of more than 15%, when you look at that entire universe of publicly traded companies, I think there are three names on that list. And those financial metrics are consistent with what we're delivering as a private company.
Lowell Singer:
So if we can continue to execute on our strategy and then layer in some incremental organic growth from some of these strategic initiatives that we are undertaking, it puts us in a very rarefied group when you look at the metrics that I think public and private investors are interested in. That gets me excited as well. Because as I said earlier, I think that there's a vast field in front of us. And the opportunities are extraordinary if we can continue to execute as well as this company has executed for much of the last decade.
John Pelle:
Well, I'm going to do a little bit of a sidebar question. Are you a fan of The Office?
Lowell Singer:
I have watched The Office. My daughter has watched the entire series about 15 times, but I would be misleading you if I told you I was an aficionado, apologies to Ricky Gervais and Steve Carell.
John Pelle:
I was going to say, they're probably tuning in. So I was going to ask you your thoughts on David Wallace, CFO of Dunder Mifflin, but maybe we could let your daughter send in a quote.
Lowell Singer:
It is funny because when I told her I was taking a CFO job, that was her reference point. And I thought that was probably going to be a manageable bar for me.
John Pelle:
I'm going to probably butcher this, but I think he was a CFO. I think that's why they cast him. So, Lowell, you never know, you might have just been discovered.
Lowell Singer:
Listen, I had 15 years at the Walt Disney Company working with some of the leading creative executives in the industry. And through that period of time, none of them tapped me for anything, hosting, acting, comedy, so I do fear John that my window has passed.
John Pelle:
Well, you never know. It's never too late. Soz was an early guest and he said, you haven't made it in life until you're on Limitless Possibilities.
Lowell Singer:
Listen, I believe, I had to do once in my time at Disney, where we were doing an investor event, and I had created this skit that I wanted our CEO to go do with Jimmy Kimmel, which was all these Wall Street terms, and what do they mean. So I pitched this whole idea to Bob Iger and he said, "This is a great idea. We're going to do it. The only difference is you're going to go do it, not me." So I go over to Kimmel's studio. And I had not met Jimmy at the time. And the whole idea was he was going to tape his show and clear the audience out. And then we were going to record this bit. And his executive producer at the time, Jill Leiderman, who was lovely, walked into my dressing room. And she said, "We're ready to go, one small change."
Lowell Singer:
I said, "What's that?" She said, "Jimmy decided to keep the audience. He thought it would be more fun." So here I was the head of IR at Disney, walking out in front of his entire studio audience, who he had prepped with, this guy is a corporate guy from Disney, and we're going to have some fun with him. So I had to go out and do five minutes of shtick with Jimmy Kimmel, in front of a live audience. And I'd like to believe I at least held my own and we got some good chuckles, so it panned out okay. But he didn't ask me to come back.
John Pelle:
Is this online?
Lowell Singer:
This is not online.
John Pelle:
Can we get that?
Lowell Singer:
I have the video. It does exist, but it is not online.
John Pelle:
Well, Lowell, this has been such a fun conversation. I mean, I'm definitely eager to have you back on. You mentioned there's probably some things in the works that you'll be able to talk about in more depth and detail. I wouldn't be able to let you go before we ask our last question, which is the theme of the podcast, Limitless Possibilities. Guests throughout the season have had very different responses on what that word actually means. Grahame's comment was, "Sometimes it feels like overwork," which I thought was maybe a funny commentary on everything. But in all seriousness, what does the word limitless possibilities mean to you?
Lowell Singer:
I thought a lot about taking this job and sort of why I wanted to be at Acrisure. And there's this movie, The Post, which was a Steven Spielberg movie about the Washington Post and the Pentagon Papers. And Bob Odenkirk plays this reporter who actually gathers all the Pentagon papers and he walks him into Ben Bradley's office. And at one point he says something like, "I always wanted to be part of a small rebellion." And I was just struck by that line every time I watched that movie. And I haven't watched it that many times, but I've watched it enough to hear this line a couple of times. I've been struck by the excitement around that.
Lowell Singer:
And I guess in my own career, which has been going on for a while, I've always wanted to be part of a small rebellion. And one of the things that appealed to me about Acrisure was the opportunity to be part of that rebellion, part of that small team that is doing things differently. So when I think about limitless possibilities, I do think about kind of this vast open field in front of us, and this management team having the ability to lead this company in a way that's unique and different from how everyone else is doing it. And I'm excited to be part of our own small rebellion.
John Pelle:
Love it. Well, Lowell Singer, part-time CFO, part-time standup comic, love to have you back on. Thank you for taking the time out of your day to share all your insights.
John Pelle:
Thanks for listening to this episode of the Limitless Possibilities podcast, follow Acrisure on social media and subscribe to the podcast to stay tuned for new episodes. We want to hear from you. So send us ideas, questions, and suggestions for future episodes to communications@acrisure.com.
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